Oscar Highlights 2011

Grazer, who also helped produce "Tower Heist," may be tasked with trying to keep Murphy as host, according to Deadline's Nikki Finke.

Murphy announced his Oscars exit one day after his longtime collaborator, Ratner, resigned amid the controversy stirred up by his use of a homophobic slur and a series of explicit radio and TV interviews over the past week.

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"First and foremost I want to say that I completely understand and support each party's decision with regard to a change of producers for this year's Academy Awards ceremony," Murphy said in his statement. "I was truly looking forward to being a part of the show that our production team and writers were just starting to develop, but I'm sure that the new production team and host will do an equally great job."

Academy President Tom Sherak responded, saying, "I appreciate how Eddie feels about losing his creative partner, Brett Ratner, and we all wish him well."

Murphy was hand-picked to host the show by Ratner, with whom he recently made "Tower Heist." The decision to step down appeared to be entirely Murphy's.

The Academy was set scrambling for a new producer and host only a few short months before its February 26, 2012 air date.

Ratner stirred up trouble over the past week when, during a Q&A following a screening of "Tower Heist," he responded inappropriately to a question about how he and his actors prepare for scenes. He also appeared on the G4 Network's "Attack of the Show" and said several disparaging things about that actress and former "Attack" host Olivia Munn (which he later apologized for). Ratner capped off his week by calling into the Howard Stern radio show and openly discussing having sexual relations with Lindsay Lohan.